Corn Commentary


Corn – Just My Opinion

Sept Corn closed 5 ¾ cents higher ($3.62 ¾), Dec 4 ¾ cents higher ($3.71) & March 4 cents higher ($3.81 ¾)

Sept Chgo Ethanol closed $0.034 cents a gallon higher ($1.329) & Oct $0.023 cents higher ($1.345)

Weekly Ethanol Grind – 1.038 million bpd vs. 1.023 Million bpd week ago – Stocks – 23.0 million bbls vs. 23.4 million bbls week ago

Weekly Corn Export Sales – old crop vs. 50-250 K T. expected – new crop vs. 350-800 K T. expected

Flat price corn registers an impressive price performance on Wednesday as it registered an outside day; new lows for the move and closing above the previous day’s high suggesting a reversal for the current down move. Early in the day session Dec corn came within a ½ cent of the May 13th contract low. Follow through was non-existent and that prompted some short covering. The USDA Secretary announced that in the coming weeks the WH will announce ways to mitigate the recent bio-fuel waivers. The weekly ethanol grind had a positive slant to it as production increased vs. the previous week while stocks declined vs. the previous week. I heard some rumblings that selected elevators will give producers another 30 days to price their old crop before they have to re-up for new storage charges. Many had been fearful that come Sept 1st producers would throw in the towel on their old crop that they had been paying storage on. On the weather front – cool temps will be with us for the near term – I have not found any forecasts for frost for the near term.

Interior corn basis levels continue to run steady to better on a lack of fresh producer selling. The Gulf basis at its midday posting was running unchanged with last night’s posting. Corn spreads showed a bullish bias with the Sept contract leading the way. Overnight we saw some cancellations of previously registered contracts. I’m maintaining my thought that corn deliveries on Friday will be minimal if any at all.

Today’s suggested reversal should have a stabilizing effect on the flat price. Without frost talk or some new demand showing up I question the rally potential. Yes, the spec trade has become a decent sized net short in a relatively short period of time so there is some room to rally. If today’s suggested reversal is any good I would think Dec corn is good for a test of the $3.80 level.

Daily Support & Resistance for 08/29

Dec Corn: $3.67 – $3.77    

March Corn: $3.78 – $3.88

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